Sears secures Canada takeover

Shareholders back upgraded tender

Sears Holdings Corp. said Thursday that it has won shareholder support for a $778 million takeover of its Canadian unit after it sweetened the offer by almost 7 percent this week.

Sears Canada investors with about 7.61 million shares accepted the offer of $18 a share Canadian ($15.48 U.S.), giving the Hoffman Estates-based parent company enough stock to complete the transaction.

The shares traded above $18 Canadian on Thursday, closing at $18.50 ($15.91 U.S.) on the Toronto Stock Exchange, on speculation that some shareholders might take court action because they believe Sears Holdings isn't paying fair value.

"Somebody thinks it ain't over," said Ronald Mayers, head of alternative strategies at Montreal-based Desjardins Securities Inc., which owns Sears Canada shares and was holding out for a higher offer. "It's check, but not checkmate."

The 7.61 million shares, combined with previous commitments by shareholders, gives Sears Holdings about 25.3 million shares in addition to the stock it already owned. The company needed about 24.8 million shares to complete the transaction and take the unit private. Sears Holdings owned 54 percent of Sears Canada before its initial bid in December for the remaining 46 percent.

Sears Holdings said this week that Vornado Realty LP, a New York-based real estate trust, agreed to sell its 7.5 million shares after the company increased its bid from $16.86 Canadian ($14.50 U.S.) a share. Natcan Investment Management Inc., which was the biggest minority shareholder with 9.69 million shares, had already agreed to tender its stake.